Merely possessing or intending to use counterfeit currency is not sufficient to constitute an offense under S.489-C without the mens rea of 'knowing or having reason to believe the currency notes or bank notes are forged or counterfeit'.

1. Leave granted.

2. The convict, in session trial No. 26 of 1991 on the file of the learned sixth Additional Sessions Judge,

Bilaspur, under S.489-B and 489-C of the Indian Penal Code (for short, 'IPC') who was sentenced to three years' rigorous imprisonment on each count, is in appeal from the judgment of the High Court of Madhya Pradesh at Jabalpur in Criminal Appeal No. 39 of 1992, allowing it in part on November 11, 1999. The High Court upheld the conviction but reduced the sentence from three years' rigorous imprisonment to two years' rigorous imprisonment under S.489-B and one year's rigorous imprisonment under S.489-C.

3. Heard Mr. Pramod Swarup, the learned counsel appearing with Mr. Praveen Swarup, advocate-on¬record for the appellant and Ms. Gitanjali Mohan, the learned counsel appearing with Mr. Prakash Shrivastava, Advocate-on record for the respondent-State .

4. The gravamen of the charge against the appellant is that on May 25,1990 at about 10 p.m. having purchased one kilo gram of mango costing Rs. 5/- he paid a fake currency-note of Rs. 100/- to PW4 who doubted its genuineness. She showed it to PWs. 2 and 7 who also said that it was a fake currency-note. He was handed over to police who recovered 13 more such fake currency notes from him. Further some papers, refills of different colours and scissors were also recovered from his house. On these facts charges were framed against him under S.489-A, 489-B and 489-C of I.P.C.

5. After considering the evidence on record the learned trial judge acquitted him of charge under S.489-A but found him guilty of charges under S.489-B and 489-C of IPC and sentenced him for the periods noted above. On appeal, the High Court confirmed the conviction but reduced the sentence, aforementioned.

6. The conviction of the appellant by the trial court as confirmed by the High Court is under S.489-B and S.489-C of IPC, which read as under:

"489-B. Using as genuine, forged or counterfeit currency-notes or bank-notes -

Whoever sells to, or buys or receives from, any other person, or otherwise traffics in or uses as genuine, any forged or counterfeit currency-note or bank-note, knowing or having reason to believe the same to be forged or counterfeit, shall be punished with [imprisonment for life], or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine.

"489-C. Possession of forged or counterfeit currency notes or bank-notes -

Whoever has in his possession any forged or counterfeit currency-note or bank-note, knowing or having reason to believe the same to be forged or counterfeit and intending to use the same as genuine or that it may be used as genuine, shall be punished with imprisonment of either description for a term which may extend to seven years, or with fine, or with both."

7. S.489-A to 489-E deal with various economic offences in respect of forged or counterfeit currency notes or bank notes. The object of Legislature in enacting these provisions is not only to protect the economy of the country but also to provide adequate protection to currency notes and bank notes. The currency notes are, inspite of growing accustomedness to the credit cards system, still the backbone of the commercial transactions by multitudes in our country. But these provisions are not meant to punish unwary possessors or users.

8. A perusal of the provisions, extracted above shows that mens rea of offences under S.489-B and 489-C is, "knowing or having reason to believe the currency notes or bank notes are forged or counterfeit". Without the afore-mentioned mens rea selling, buying or receiving from another person or otherwise trafficking in or using as genuine forged or counterfeit currency notes or bank notes, is not enough to constitute offence under S.489-B of I.P.C. So also possessing or even intending to use any forged or counterfeit currency notes or bank-notes is not sufficient to make out a case under S.489-C in the absence of the m